Activation of signal transduction pathways by hormonal and developmental stimuli ultimately leads to changes in the expression of specific genes. Frequently, these changes occur at the level of gene transcription and are mediated by the rapid phosphorylation and dephosphorylation of specific transcription factors that bind to control sequences in eucaryotic genes. Abnormalities in the signalling pathways and transcription factor phosphorylation can lead to a variety of metabolic diseases and changes in normal cell growth and differentiation. The cAMP regulatory element binding protein (CREB) is a transcription factor that stimulates the transcription of target genes in response to hormonal signals that elevate intracellular cAMP levels. This process involves the phosphorylation of CREB by the cAMP-dependent protein kinase (PKA). However, the phosphorylation of CREB by PKA is precisely regulated, and there is evidence for a mechanism that dephosphorylates CREB and inhibits its ability to stimulate transcription. Recently, protein phosphatase 2A (PP2A), but not protein phosphatase type 1 was shown to dephosphorylate CREB and inhibit the ability of CREB to stimulate transcription in a cell-free assay system. These results indicate that protein phosphatases play a key role in regulating gene expression, and that they are selective in dephosphorylating substrate proteins. The proposed research will further investigate the role of nuclear serine/threonine-specific protein phosphatases in regulating transcription factor phosphorylation and gene transcription. Specific anti-phosphatase antibodies will be prepared to identify and quantitate the phosphatases present in the nucleus. The ability of the identified phosphatases to selectively dephosphorylate CREB and the related Activating Transcription Factors (ATFs) that have been phosphorylated with specific protein kinases will be examined. The ability of the nuclear protein phosphatases to regulate the transcriptional activity of the CREB and ATF proteins will also be assessed, using cell-free transcription analysis. Additional preliminary evidence indicates that the small-t antigen of Simian Virus 40 (SV40) may enhance the dephosphorylation of CREB by PP2A. This is significant because small-t is a specific and potent inhibitor of PP2A. The proposed research will further investigate the interactions of small-t, PP2A and CREB in living cells and in cell-free reactions. The data from these experiments should confirm the conclusion that PP2A is the primary enzyme that dephosphorylates CREB. The findings should also establish small-t as an important reagent for studying the activity of PP2A in transcriptional regulation.